Shell PLC

Welcome to Shell's first quarter 2025 results. Just over five weeks ago, at our Capital Markets Day in New York, Wael and I outlined the Shell investment case and our longer-term vision for the company. Our aim is to continue to deliver more value with less emissions, whilst rewarding our shareholders with consistency, delivering both competitive and resilient returns. And in Q1, we continue to make good progress. And as we look forward, we remain confident due to both our portfolio's strength and an organisation which continues to deliver, guided by our principles of performance, discipline and simplification. What we hope is now clear is that we do what we say. As we said at Capital Markets Day, we met our CMD23 financial targets for 2025 almost a year early. And as a result, we set new financial targets whilst we were staying firm on our carbon targets and ambition. Repositioning the portfolio is a key step towards achieving our targets. and we have made meaningful progress in the first few months of 2025. We've completed our divestments of the Energy and Chemicals Park in Singapore and in onshore Nigeria. And as we said we would, we are growing, but in a disciplined way. We completed the acquisition of Pavilion Energy, strengthening our integrated gas portfolio by further expanding our LNG trading and optimisation capabilities. In Upstream, we signed an agreement to increase our working interest in Ursa in the Gulf of America. We already operate this asset, and we're pleased to be able to further consolidate our leading deepwater position. On projects, we took two key final investment decisions. The first is Gato do Mato in Brazil. This will be a shell-operated asset in the Santos Basin, where we are the largest foreign producer. The second is phase two of the Northern Lights carbon capture and storage development in Norway. This will increase the project's capacity from 1.5 million tonnes to more than 5 million tonnes of CO2 a year by 2028. And on operations, in the first few months of 2025, we've achieved significant milestones. I want to highlight just two of them. First, our Penguins FPSO in the UK North Sea is now online and supplying much needed natural gas to the region. This modern FPSO is expected to extend the life of the field by up to 20 years. And second, Dover in the Gulf of America has started production. This is the second subsea tieback to our Appomattox hub after Rydberg, which came online last year. Now let's move to the financial results for the quarter. We delivered solid results in a price environment that was relatively stable compared with last quarter. Our adjusted earnings were $5.6 billion, up 52% compared with Q4. And we generated $11.9 billion of cash flow from operations, excluding working capital. Consistent with outflows seen in the first quarter of recent years, working capital in Q1 was an outflow of $2.7 billion. Now turning to our businesses. Integrated gas production was higher than in Q4 as the turnaround at Pearl GTL was completed. However, liquefaction volumes were lower because of unplanned outages in Australia. Our LNG trading and optimisation results were in line with Q4, and that's despite the higher non-cash paper losses recorded, which we highlighted would be seen across the first three quarters of the year. Upstream had a strong Q1 with continued high controllable availability. Norway, Nigeria offshore and Kazakhstan all delivered above 98%. In marketing, mobility and lubricants performed very well as both continue to further increase premium product margins. However, the low carbon option businesses continue to operate in a difficult macro environment, which we highlighted at CMD. Chemicals also continue to see low margins this quarter. But with the divestment in Singapore, we expect that the chemicals earnings contribution will improve. In products, the contribution from trading and supply improved relative to the previous quarter, almost at similar levels to Q2 and Q3 of last year. So overall, a solid set of results in the first quarter of 2025. We are now into the second quarter, and there are significant macro uncertainties. But our approach remains the same. We're following through on the long-term direction we set at Capital Markets Day. At times like this, the importance of a strong balance sheet and a robust financial framework are critical. And we have consciously positioned the company over the last few years, leaving us well-placed. In Q1, our net debt position increased. reflecting lease additions from Pavilion and a drawdown from the loan facilities provided at the completion of the Nigeria onshore divestment. These are all known items, and our balance sheet continues to be one of the strongest in the industry. Moving on to shareholder distributions. Today, we have announced a $3.5 billion share buyback program, which we expect to complete by the time of our Q2 results announcement. This makes it the 14th consecutive quarter in which we have announced $3 billion or more in buybacks. With this new $3.5 billion share buyback program, we are well within our enhanced shareholder distribution range of 40% to 50% of CFFO. a range that you can expect us to deliver on through the cycle given our low distribution break-evens. $40 Brent for dividends and buybacks continuing at $50. To summarise, in Q1 we delivered a solid set of results in a relatively stable price environment. Our portfolio transformation is progressing with several major achievements during the first few months of 2025. Looking ahead, we are confident in the direction we have set and the strength of Shell to deliver for our shareholders through an uncertain macro. We will continue to focus on operational performance, be disciplined with cost and capex spend, and drive competitive and resilient returns. And most importantly, deliver on what we say. And finally, we hope that shareholders who are able to attend either virtually or in person will join us for our 2025 Annual General Meeting, which will take place on May 20th. Thank you.

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Thank you. Thank you very much for joining us today. We hope that after watching this presentation, you've seen how we delivered a solid set of results in the first quarter, how we made meaningful progress in repositioning our portfolio to deliver on our targets and the strength of the company to deliver through an uncertain macro. Today, Sinead and I will be answering your questions. And now, please, could we have just one or two questions each so that everyone gets the opportunity? And with that, could we have the first one, please, Luke?